3M sold its global branded pharmaceuticals business, 3M Pharmaceuticals, for approximately $2.1 billion to three companies. Graceway Pharmaceuticals will acquire operations in the U.S., Canada, and Latin America for $875 million, Meda AB will take over the European sector for $857 million, and Ironbridge Capital and Archer Capital will gain access to the Asia Pacific market, including Australia and South Africa, for $349 million. 3M says the agreements are the result of a review of strategic options for the branded pharmaceuticals business and its immune response modifier (IRM) platform.
Under the agreements, the purchasers will acquire regional marketing and intellectual property rights for 3M’s branded pharmaceuticals, including Aldara, Difflam, Duromine, Tambocor, Maxair, Metrogel-Vaginal, and Minitran. 3M’s drug delivery systems division will be a source of supply to the acquiring companies.
As part of the transaction, Graceway will also acquire the rights to certain IRM molecules. Graceway estimates 2006 net revenues for the products in North and Latin America will total approximately $350 million. It will also enter into a technology access and development agreement with 3M.
There are approximately 1,050 employees in 3M’s Pharmaceuticals Division worldwide. 3M reports that approximately 70% of those employees will receive employment opportunities with the acquiring companies.
The transactions are scheduled to close in the fourth quarter. 3M says it will record a gain related to the transactions and will incur various restructuring charges as it continues to align to drive growth and improve productivity.